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China Environment unit may be wound up
CHINA Environment announced on Wednesday that as a result of an earlier Chinese court ruling on a civil suit brought by Bank of China Longyan against China Environment's wholly owned subsidiary Fujian Dongyuan Environmental Protection Co Ltd, the land use rights and property assets of another wholly owned subsidiary Anhui Dongyuan Environmental Protection Co Ltd have been auctioned off.
Bank of China Longyan auctioned off these rights and assets for 60.6 million yuan (S$12.2 million). They had been pledged as security for the estimated 70 million yuan in loan principal plus interest due to the bank.
China Environment added that Bank of China Longyan will be informing the company on how it intends to claim the balance owing to it, after the Chinese court has distributed the auction proceeds.
China Environment said that it does not expect Fujian Dongyuan Environmental Protection Co Ltd to be able to repay any outstanding balance due to Bank of China Longyan, and that Fujian Dongyuan Environmental Protection Co Ltd may be involuntarily wound up as a result.